How do I compare a USD contract rate with a local salary?

Compare total value, not the headline number.

A contract rate usually has to cover things an employer would otherwise provide. Before comparing, subtract or account for:

• Paid leave and public holidays. As a contractor you often aren't paid for days you don't work.
• Employer contributions and benefits that local employees receive, such as retirement fund contributions, health insurance and bonuses.
• Taxes you'll handle yourself as a contractor. Check current rules with the Inland Revenue Department or an adviser.
• Payment and currency conversion fees.
• Equipment, internet and backup power.
• Less stability: shorter notice periods and gaps between contracts.

Also think about currency. Being paid in USD protects you if the local currency weakens, but your income in local terms will move as exchange rates change.

Then weigh the non-money factors: learning, the team, growth and work hours.

Our guides to comparing job offers and setting your rate as a remote developer have worked frameworks.